Question

Why is access to YouTube by other search engines such as Yahoo and Bing relevant to the question of whether Google has a monopoly in the Internet search engine market?

Answer 1

Access to YouTube by other search engines such as Yahoo and Bing is relevant because, Internet search results with a link to YouTube videos make Google the dominant monopoly in the marke. Monopoly (google) such as it has over internet search would never be allowed. But three factors conspire to Google’s advantage. Firstly, digital services, however ubiquitous, seem less tangible and therefore do not appear so obvious a threat to commercial pluralism, innovation and to consumer interests.

Google's monopoly does not come from coercion or anti-competitive practices. Instead, it is derived from offering a superior product. On the Internet, there is little barrier to entry so anyone can set up competition at little cost. Through Google's history, many well-capitalized companies have attempted to wrest market share away from it. The most aggressive and recent competitor was Microsoft's (MSFT) Bing. Even Google at one time was an upstart company that beat out billion dollar companies such as Microsoft and Yahoo (YHOO), which were dominant in Internet searches.

Google makes money from searches by selling promoted advertising based on search keywords. The ads are more powerful than traditional advertising because they can be targeted by interest and geography. Advertisers like the program because they can get real-time feedback on the effectiveness and engagement of their ads. This continues to be the backbone of Google's business and its major source of revenue.

Additionally, the Internet remains in its infancy. The proliferation of the Internet and the manner in which it has made its way into the daily lives and activities of human beings is a marvel. Predicting the future is impossible, as are the winners and losers. New companies will emerge from nowhere, like Google did less than 20 years ago. The biggest threat to Google and other Internet companies is less likely to be a well-funded competitor but instead a teenager playing around with code in her basement.

Google is well aware of this reality and continues to use cash flows coming in from searches to invest in other ventures. Some of these ventures have been failures, such as Google Glass or Google Plus, its foray into social media. However, some of its ventures such as Android, Chrome, and YouTube have proved to be successes in terms of user engagement and retention. Yet even with this traction, Google has not been able to monetize these offerings. Instead, the Google search cash cow allows the company to remain patient while it pursues its broad strategic goals.